A Victorian principal wants to pay $500 from the agency's general business account into the trust account to cover a landlord's repair invoice early. What does CAV guidance say?
Correct Answer
A) Generally not allowed, except to make good a deficiency in trust
The CAV trust account guide says agencies should generally not make payments from general business accounts to trust accounts. The exception is where this is needed to resolve a deficiency in the trust account, which must also be notified to CAV and the auditor within three business days unless an exception applies.
Why This Is the Correct Answer
General account money goes into trust only to cover a deficiency.
Why the Other Options Are Wrong
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- → Which of these amounts received by a NSW sales agency is trust money under the Property and Stock Agents Act 2002?
- → An agency records every sales deposit it holds in a single ledger headed 'Sales deposits'. What does the Regulation require instead?
- → A property manager receipts $1,800 cash rent on Tuesday and locks it in the office safe for the agency's usual Friday banking run. Is this compliant, assuming Wednesday banking was practicable?
- → A supplier obtains a court judgment against a NSW agency for unpaid office fit-out costs and tries to enforce it against the agency's trust account. What is the position?
- → A licensee in charge is going on leave and wants her Class 2 senior property manager to approve trust payments while she is away. Can she delegate this?
- → At the end of August an agency balances its trust cash book and reconciles it to the bank statement. By when must it prepare the trial balance of all trust ledger accounts?
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A Victorian landlord asks the property manager to draw this month's rent from trust as a cheque made out to 'cash' so it can be cashed anywhere. How should the agency respond?
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A Victorian trust clerk posts a rent receipt to the wrong landlord's ledger in the agency's trust software. How must the error be corrected?